Group items tagged

This is an article of interest because it hits on a variety of things that we have and are continuing to study: import tariffs, the WTO, global trading in general, and the effects that each nation's actions have on one another.

This article raises awerness of the potencial risks that protectionism polices, import tariffs in this case, might have on the economy. If the WTO talks fail and Ukraine increases import tariffs it could have huge consequences with its trading partners as the local firms of the trading partners will suffer heavy losses, potencially leading to that specific export sector closing, which in time would effect the economic growth of the exporting country/countries. That is why there always has to be a balance with protectionism policies, iit must both benefit the importer and exporter

Scottish Power has announced a price rise in the gas and electricity bills by 7%. The firm has 2.3 million customers and the average yearly bill will increase to £1,271. The rise is said to be caused by an increase in costs for transporting gas and electricity. Other energy firms have also raised prices. The demand for the product, electricity and gas, is definitely inelastic in this case, since electricity and gas are necessities for the people. People will still need electricity regardless of how much price has increased. Demand will remain the same. All the energy firms are also raising costs, so the consumers have no substitutes. They have to endure to higher bills to come.

The recent drought in the pass summer in the Midwest has resulted in a decrease in crops. As a result, not only that restaurants have to struggle with high fuel costs and inactive economy, they also have to struggle with higher food costs with poorer quality. For example, a restaurant used to offer a bowl of pasta at $8.95. However, in the late August, the price jumped to $9.95. Eggs cost 18% more than they did a year earlier. Restaurants need to adjust menus, reduce portion sizes, even consider staff cuts, and also increase prices of their food in order to sustain their businesses.Experts predict that the overall food costs could possibly rise at 5% to 20%. In consequence, customers are less seen out in restaurants. This relates to price mechanism and equilibrium. Lower supply of food shifts the supply curve to the left. This means that the amount being supplied and demanded is different. Producers then must have to raise prices to adjust to higher costs of production. In consequence, amount being demanded at a new price is decreased, setting a new equilibrium price and quantity. This is a downside for the producers since they must increase price to adjust to higher food costs, but because of that, less is being demanded. The restaurants can either choose to lower their price to the original in order to attract customers or remain at the increased price. Either way, restaurants are still affected.

This article describes the effect of raising taxes on the people. Tax payed by the rich can be used by the government for man reasons such as implementing new policies, improving public amenities, and to benefit the poor. The article says that raising taxes has two main effects, one that people work less since work is now less rewarding. It also may cause people to feel the need to work longer hours because the might need to make some more money to keep the household running. One important determinant of the effect of tax rates is the relative position compared to other countries. Another is the international mobility. This mobility occurs because people believe that in other countries with lower taxes their pay will be greater and they can live a better life. The greater the mobility, the greater the elasticity of supply with respect to changes in taxes.

Last month, governor Joko Widodo has taken over the top job in Jakarta, as he has agreed to raise minimum wage. From the previous amount of 1.53 million rupiah, the new governor has agreed to increase the wage to 2.2 million rupiah. Suppliers are grumbling as one shoe owners states that "that large an increase is irrational" and is not sure if "buyers will be willing to pay more." In addition, high wages may prompt inflation, and discourage investment as suppliers are detrimentally affected. There is a critical balance that must be struck between the impacts of the people and the cost of the suppliers.

this article talks about if we are going to have carbon tax as the increasing of using resource such like fuel by the companies, and the companies made a lot of pollution, it give us a negative externality as a whole. all the people on earth has a bad effect by the pollution, increasing of the carbon is one of the thing companies made, in order to stop companies from keeping producing carbon, let's think about put the carbon tax.

i really like this article as it focuses on the fact of global warming. Also its a new point of view to stop Global warming which could be very effective as they would raise alot of money, to use in the further research of non polutent enegery sources. What they havent realised in this article that Methan has a ration 20:1 to carbon in the field of damage causing global warming and although you dont think there is a lot of methane in the world there is. Every decomposing organic material releases methane and just think about all those decomposing plant matter at the bottom of dams with a huge accumulation of methan waiting to be released.

i really like this article as it focuses on the fact of global warming. Also its a new point of view to stop Global warming which could be very effective as they would raise alot of money, to use in the further research of non polutent enegery sources. What they havent realised in this article that Methan has a ration 20:1 to carbon in the field of damage causing global warming and although you dont think there is a lot of methane in the world there is. Every decomposing organic material releases methane and just think about all those decomposing plant matter at the bottom of dams with a huge accumulation of methan waiting to be released.

The British Columbian government has stated in its newest budget a tax increase for incomes over 150,000 dollars and a permanent 1 percent increase for corporate taxes. In the 1990s, the NDP government has implemented a similar tax hike in the hopes of increasing revenue, yet the opposite happened as the rich found ways to evade taxes and even worse found no incentive to work harder. However in 2001, the liberal party slashed taxes and revenue slowly, but surely increased. It is a period of waiting as the new tax increases take effect and to see if past still holds true, or if the future will be brighter.

The author of the article talks about Indonesia. It focuses on the attempts of central bank of Indonesia to defend the rupiah, "which has slid some 12 percent so far this year amid a global emerging markets rout." The currency has fallen to its weakest levels since April 2009, as worries about the country's current account deficit and high inflation rate have sparked a sell-off of Indonesian assets. Sudden declines in rupiah and local stocks over the last week, necessitated central bank to take part. Emergency fiscal and monetary policies that were announced last week, had done little to improve the current situation. Therefore, currently to protect its currency, Indonesian central bank attempts to raise the rates.

I found this article interesting because it shows us that demand and supply is not the only factor in determining gas prices. As we know, gas prices are on the rise. But this article tells us that it is not just demand and supply that causes this and that we need to take other factors into consideration.

i thought that this article was really interesting because before i actually thought that the oil companies raised the price of oil randomly just to make a profit but now i realise that there are many other reasons why they bring up the price, for example there economy.

The government in Manila is taking advantage of taxing Tobacco. Franklin M. Drilon, acting chairman of the senate, is trying to make this tax a done deal. He thinks it should be taxed because it is a "sin" product. It would see the government raise 40-45 billion Peso's in tax revenue. Senator Ferdinand R. Marcos is concerned about this and is doing his best to prevent this tax. He knows the affects it could have on the tobacco farmers. There are about 18,000 tobacco farmers who are concerned about this tax. I think this is unfair of the Government. I don't think tobacco is a "sin" good, as it is many peoples alternative to drugs. This tax could put many producers out of jobs seeing as the demand will not be as high, and also this tax could force poor people to go back to cheaper alternatives that are very unhealthy and addictive.

A ruling has been passed leaving medial device makers stuck with an excise tax on sales of replacement hips, implantable defibrillators and other FDA-approved devices. This tax is intended to help finance the health law's board expansion of insurance coverage and is expected to raise $20 billion by 2019. The tax, which will commence January 1st 2013, has already affected some manufactures. Few companies will be able to pass all or even a small amount of the tax onto hospitals or distributors, resulting in many companies to begin putting cost-cutting plans in place. It is expected that smaller companies will take the worst hits, small device makers could see earnings per share fall by 10%. Because the tax is on total sales, rather than profits, companies with the smallest margins, such as unprofitable start-ups, will face the deepest impact. The tax looms at a difficult time for the industry, as patients will then delay elective procedures. Unlike other health-care sectors, analysts don't expect device makers to benefit much from the expected flood of newly insured patients because they depend largely on older patients who are already covered by Medicare.

In this article author talks about excise tax and specificly about excise tax that was imposed in 1898 and survived till nowadays. The purpose of that taxation was to pay for the Spanish-American War. The war was over in 6 months but tax stayed. The amount received from taxation was about $300 billion, and the amount spend on war was $6 billion. This tax is very unfair to customers, "This is a 19th-century tax on a 21st-century technology," says Jim Cicconi, AT&T's general counsel. The original purpose of the tax was to raise revenue for a specific purpose, and to do so in a way that would not be noticed by the average consumer. Today, the purpose is gone, and consumers are definitely feeling the pinch. Businesses and consumers pay the same: 3% of the total. On a $100 phone bill, that works out to $3. On a $10,000 bill - not uncommon for businesses - the tab is about $300. Another important fact pointed in that article is that phones were luxury during XIX century, but now they are almost necessities. Seven federal courts have so far declared the tax to be illegal.

This article talk about the maximum price in New York and New Jersey after the sandy huracane. The government has set new laws in order to reduce the price for the neccessity products. However those laws are causing shortages in New York and New Jersey. Government-imposed price controls are making the disaster worse a week after Sandy hit shore. The producers can´t increase the prices for goods considered neccesarie for the consumers.The businesses aren´t allowed to raise their prices more than 10 percent within 30 days of a declared state of emergency. If the businesses increase above the maximum prices they will have to pay penalties. When there is a situation of scarcity (shortage) the people will try to buy the products in the black for a higher price. When high prices are prohibited from serving their function the result is a shortage where there are more buyers than sellers. Buyers still compete with other buyers to try to get the scarce gas, but because price competition is illegal their competition takes less beneficial forms.

The article discusses how during recessions, the rich become richer and how the businesses cycles still disadvantage the poor and benefit the rich. During recessions, income inequality increases and favors those who are wealthy. As unemployment rises, many people see a significant decline in their income and saving abilities. They are no longer able to afford common resources. For example, people will need to sell their business, houses… This leaves the rich buy up such resources for a cheaper price. This is what keeps the rich constantly "on top" and the poor even poorer. There is a chart which really illustrates this statement put forth by the author.

I think it's funny to see how rich people can get even richer during recession.

This article talks about how the top 1% doesn't get affected by recessions and actually gets richer while the poorer get poor. This came as a surprise to me as I thought recession always had a negative effect on the incomes of the population, but obviously this isn't true. The article states since the recovery period of 2009, the bottom 99% of workers incomes decreased by 0.4% while the top 1% workers income raised by 11.2%, an enormous amount during a recession. In my opinion I think this might be because of the increase in black market activity during a recession, due to the fact that the richest people in the world have earned their income, one way or another, through illegal activity.

LISBON: The Portuguese economy is set to contract by 2.3 per cent this year due to a sharp fall in domestic demand and disappointing export growth

This article basically talks about the decreasing growth of the Portuguese economy. It states that the Portuguese economy will contract by 2.3% this year due to a steep fall in aggregate demand and exports. This can only lead to negative consequences as the firms will start to sell less/produce less and therefore earn less of a profit or no profit at all. SO what these firms will start to do is cut costs of FOP which basically means lay off workers, raising unemloyment, further worsening the economy, because then the people laid off will buy less from other firms and the same process will occur over and over again untill you get to the economic situation of Greece.

The article talks about Japan's monetary problem in bond markets, which has threatened to undermine the country's battle to end deflation and stimulate growth in the giant economy. This causes the banks to expand the monetary base. However, Japan is still in debt and now it has more money struggles. Governor Haruhiko Kuroda is looking for a way to combat falling price and he declares that he will even double Japan's monetary base. But again, the debts of Japan is "twice as much as the size of the country", thus Japan is vulnerable to rising borrowing costs. Fortunately, the government uses pushing government spending, boosting asset prices by raising asset price inflation expectation, and increasing the country's GDP as solutions; and they do work.

The United States remains desperate for faster growth and stronger job creation as it continues its slow recovery from the 2009 recession. Peter Blair Henry, the dean of NYU's Leonard N. Stern School of Business states private investment is falling $1 trillion short per year due a to disputes over the "fiscal cliff," the federal borrowing limit and other issues." Monetary policy and fiscal policy are working at "cross purposes" - one is expanding while the other contracts." Governments should save money during times of economic prosperity and spend it to boost the economy when growth decreases. Lawmakers should prioritize predictability in policymaking to trigger private investment and government investments, particularly in education, should be off-limits to cuts. Henry points out that a solution to closing the wage gap is to produce more skilled workers. Raising taxes on the highest tax bracket may also be part of the solution to overall sustainability concerning the fiscal side, but not a solution for income inequality.

Obama suggests US can reduce deficit by closing tax loopholes. Deficit is when expenses exceed income. This will allow the US to fund things for the economy's growth without having to raise tax. Obama also says that he wants a fair and transparent tax system and further health care reforms. He says that since US spends a lot, they need additional revenue and also smart spending reductions. This relates to cash inflow and outflow of the economy. US have been dealing will the excess of outgoing money over the incoming money. This becomes public debt for the national. This could possibly slow the the efficiency of how the government can support different sector of the country, such as the economy.

Article basically discusses whether unemployment or inflation is worse. The overall message i get is that unmeployment is worse for many more reasons that inflation. one of them would be that if parents have no money to spend on the colleges of their children then they wont get a very good education, and as those children are the future of their economy then the work force would be lower than usual which has no upside to it. Where as inflation has positive sides like housing prices raise, debt becomes more manageable, wages increase etc, so since unemployment has no upside it would be more economical to prevent unemployment than prevent inflation.

Currently the Obama administration is talking about finding new ways to create jobs and stimulate growth. However, it has proved to be unsuccessful, as the only policy that will really help is an increase in aggregate demand. The article explains that aggregate demand simply means spending: "spending by households, businesses and governments for consumption goods and services or investments in structures, machinery and equipment." At the moment, businesses should not to invest because there is lack of consumer demand. The federal government could increase aggregate spending by directly employing workers or undertaking public works projects yet this proves to be difficult. The author explains that the most important thing is for policy makers to stop focusing on debt and attempt instead to raise aggregate demand.

THis article talks about how the recession has effected America and what America really needs is an increase in aggregate demand. That is the increase in consumption, investments, exports etc. They say that a direct solution to increase aggregate demand would be an increase in aggregate spending by employing citizens in public projects controlled by the government and if that isnt enough then its all up to the citizens. It then talks about how consumer confidence significantly effects spending. that is if house holds feel that they are rich, then they dont feel the need to save and as a result of that they spend the money they were going to spend and vice versa.